Evan Ramstad describes key features of the trade agreement for the Wall Street Journal (U.S.-Korea Trade Deal Still Faces Hurdles (April 3). He says that the final text won't be available for "a week or two." Meanwhile, we know a few things:
A few more details about cars:
...South Korea agreed immediately to drop tariffs and other restrictions on imported cars. Currently these consist of an 8% tariff, a tax on engine size and restrictions on parts, and have created one of the most lopsided car markets in the world: Just 3.5% of cars sold last year in South Korea were imported, compared with 37% in the U.S. The U.S. also will drop a much smaller tariff on Korean cars over three years and a larger one on pickup trucks over 10 years.
And another detail on beef:
South Korea agreed to end its ban on U.S. beef if an expected safety reclassification of U.S. meat is made by a world health group next month.
Agreements on government procurement and customs administration were reached in a negotiating session in early March. Here are the Korean Ministry of Foreign Affairs and Trade press releases with information on the content of the agreements:
Conclusion of the KORUS FTA Government Procurement Negotiations (March 10); Conclusion of the KORUS FTA Customs Administration Negotiations (March 11)
Yonhap News provides a 15 point summary of the agreement: Summary of S. Korea-US free trade agreement (via The Hankyoreh, April 2 in Korea)
The agreement apparently papered over divisions over goods manufactured in North Korea at the Kaesong Industrial Complex with language that permits two very different interpretations: Korea, U.S. Still at Odds Over Kaesong Goods (Chosun Ilbo, April 4 in Korea):
In a press conference right after the FTA was concluded on Monday, Trade Minister Kim Hyun-chong said, "The United States has agreed, in principle, to designate an outward processing zone. The products made at the Kaesong Industrial Complex will also benefit from the FTA”, provided a committee “designates the Kaesong Industrial Complex as such a zone." In a statement on the same day, President Roh Moo-hyun said, "We have laid the foundation for having products from the Kaesong Industrial Complex recognized as South Korean goods."
But in a telephone interview with a U.S. journalist on Tuesday morning, Deputy U.S. Trade Representative Karan Bhatia said despite many discussions on the Kaesong Industrial Complex, the agreement doesn't include goods from the complex. He denied the industrial park stands to be designated as an outward processing zone. "I can tell you there’s no contemplation on the U.S.’ part right now to allow goods from North Korea into the U.S. somehow through the FTA. That won’t happen,” Bhatia said. "What we have agreed to do is create a committee ... and within that committee we are willing to discuss" economic development issues, he added. "I would caution you against reading too much into that."
Evan Ramstad reports on the Kaesong compromise in the April 4 Wall Street Journal (U.S., Korea Defer Sticky Issue).
Revised April 3.
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